Reform New Party "Establish Fund for Priority Allocation of IPO Shares to Children Below Median Income Until Age 20"

The Reform New Party pledged to establish a fund that prioritizes the allocation of public offering shares to children born into households below the standard median income. The party explained that this aims to resolve the deepening asset polarization and make all citizens middle class.

On the afternoon of the 5th, Kim Yong-nam, the Policy Committee Chair of the Reform New Party, announced at the National Assembly Communication Office in Yeouido, "We propose the establishment of the 'Our Child Public Offering Shares Priority Allocation Fund,' which prioritizes the allocation of public offering shares to children born into households below the standard median income from age 0 to 20."

According to the Reform New Party, based on the Gini coefficient, the recent trend shows that income polarization has somewhat eased, while asset polarization has worsened due to factors such as the surge in real estate prices during the previous administration.

Reform New Party Policy Announcement
(Seoul=Yonhap News) Reporter Han Sang-gyun = Kim Yong-nam, Chairman of the Policy Committee of the Reform New Party, is announcing the party's policy at the National Assembly on the 5th. 2024.3.5
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Specifically, the subscription target for the 'Our Child Public Offering Shares Priority Allocation Fund' is households below the standard median income. For a family of three, this means a monthly income of approximately 4.7 million KRW or less,

and for a family of four, a monthly income of approximately 5.7 million KRW or less.

The maximum monthly contribution is 200,000 KRW, totaling 2.4 million KRW annually. Assuming all newborns born into households below the standard median income subscribe to this fund, the fund's size is projected to be about 276 billion KRW based on the 230,000 newborns in 2023.

Policy Chair Kim explained, "Last year, the total public offering amount was about 3.8 trillion KRW, so the 276 billion KRW scale of the ‘Our Child Public Offering Shares Priority Allocation Fund’ accounts for only about 7%, which is a sufficiently feasible ratio."

The Reform New Party believes that if the legislative tasks they proposed are successfully carried out and the capital market is advanced, it would be possible to achieve an average annual growth rate of about 8%, similar to the U.S. S&P 500. Based on 8%, investing a maximum of 200,000 KRW monthly for 20 years would grow the principal of 48 million KRW to approximately 118.5 million KRW including earnings after 20 years.

The Reform New Party stated that they will propose an amendment to the Restriction of Special Taxation Act in the 22nd National Assembly to exempt taxes on fund earnings, so that future generations born into households below the standard median income can have financial assets exceeding 100 million KRW by the time they turn 20.

This content was produced with the assistance of AI translation services.